New Jersey Verdicts

Plaintiff(s):

Mylan Inc. , 

Mylan Pharmaceuticals Inc.

Plaintiff Attorney(s):

John Michael Vazquez;
Critchley, Kinum & Vazquez, LLC;
Roseland,
NJ,
for
Mylan Inc., Mylan Pharmaceuticals Inc. ■ Frank G. Smith III;
Alston & Bird LLP;
Atlanta,
GA,
for
Mylan Inc., Mylan Pharmaceuticals Inc. ■ Natalie C. Clayton;
Alston & Bird LLP;
New York,
NY,
for
Mylan Inc., Mylan Pharmaceuticals Inc. ■ Michael E. Johnson;
Alston & Bird LLP;
New York,
NY,
for
Mylan Inc., Mylan Pharmaceuticals Inc.

Plaintiff Expert(s):

Mark Gleason;
C.P.A.;
Damage Analysis;
Pittsburgh,
PA called by
John Michael Vazquez, Frank G. Smith III, Natalie C. Clayton, Michael E. Johnson ■ Benjamin Maizel;

Pharmaceuticals Regulatory Affairs;
St. Petersburg,
FL called by
John Michael Vazquez, Frank G. Smith III, Natalie C. Clayton, Michael E. Johnson

Defendant(s):

Apotex Inc., 

Apotex Corp., 

SmithKline Beecham Corp., 

SmithKline Beecham P.L.C., 

SB Pharmco Puerto Rico Inc., 

SmithKline Beecham (Cork) Ltd.

Defense Attorney(s):

Eric I. Abraham;
Hill Wallack LLP;
Princeton,
NJ,
for
Apotex Inc., Apotex Corp. ■ Thomas A. Cunniff;
Fox Rothschild LLP;
Lawrenceville,
NJ,
for
SmithKline Beecham Corp., SmithKline Beecham P.L.C., SB Pharmco Puerto Rico Inc., SmithKline Beecham (Cork) Ltd. ■ Christina L. Saveriano;
Hill Wallack LLP;
Princeton,
NJ,
for
Apotex Inc., Apotex Corp. ■ F. Christopher Mizzo;
Kirkland & Ellis LLP;
Washington,
DC,
for
SmithKline Beecham Corp., SmithKline Beecham P.L.C., SB Pharmco Puerto Rico Inc., SmithKline Beecham (Cork) Ltd. ■ Gregg F. LoCascio;
Kirkland & Ellis LLP;
Washington,
DC,
for
SmithKline Beecham Corp., SmithKline Beecham P.L.C., SB Pharmco Puerto Rico Inc., SmithKline Beecham (Cork) Ltd. ■ Michael A. Pearson;
Kirkland & Ellis LLP;
Washington,
DC,
for
Apotex Corp., SmithKline Beecham Corp., SmithKline Beecham P.L.C., SB Pharmco Puerto Rico Inc., SmithKline Beecham (Cork) Ltd. ■ Corey J. Manley;
Kirkland & Ellis LLP;
Washington,
DC,
for
SmithKline Beecham Corp., SmithKline Beecham P.L.C., SB Pharmco Puerto Rico Inc., SmithKline Beecham (Cork) Ltd.

Defendant Expert(s):

Carla Mulhern;
Economics;
Washington,
DC called by
Thomas A. Cunniff, F. Christopher Mizzo, Gregg F. LoCascio, Michael A. Pearson, Corey J. Manley

In June 2007, GlaxoSmithKline LLC (GSK) sued generic drug-maker Mylan Inc. for allegedly infringing its patent for the antidepressant drug Paxil CR. GSK claimed the infringement occurred when Pennsylvania-based Mylan filed a new-drug application for generic versions of the drug. The companies resolved the dispute in a settlement by which Mylan would have the exclusive right to sell the generic version of the drug. To alleviate Federal Trade Commission concerns about the agreement’s long exclusivity period for Mylan, the companies added two exceptions, one of which was that "GSK or its Affiliate may commence marketing and selling" the generic version of the drug beginning two years after Mylan launched its own generic product. In 2010, GSK settled an antitrust lawsuit with Apotex Corp., agreeing to supply the Canadian generic-drug company with the authorized generic version of Paxil CR for market resale. Mylan sued GSK and Apotex for breach of contract and tortious interference with a contract, respectively. Mylan alleged that GSK violated its contract by supplying generic Paxil CR to Apotex which was not an affiliate of GSK, as required by the exception to their contract, and which would compete with Mylan. At issue was whether GSK could market and sell the generic drug through a third-party generic manufacturer under the exception to its contract with Mylan, or whether GSK or an affiliate was required to sell directly to the market. In 2012, the district court granted summary judgment in favor of GSK and Apotex, finding that the agreement between Mylan and GSK did not limit to whom GSK could sell the authorized generic drug after two years. But the Third Circuit, in July 2013, remanded Mylan’s breach of contract claim to the district court for trial. At trial, Mylan’s expert in pharmaceutical-industry practices opined that neither company had intended the 2007 agreement to allow GSK to supply a third-party competitor such as Apotex with the authorized generic, and that New Jersey contract law focused on the parties’ intent in interpreting contracts. When read in context, the plain language of the agreement supported Mylan’s position, according to the expert. Mylan witnesses testified that the parties had expressly agreed during negotiations that GSK could not supply the authorized generic product to a competitor, such as Apotex. (GSK witnesses testified that they did not recall the negotiations addressing the issue.) The defense maintained that the agreement permitted GSK to sell a generic Paxil CR to any buyer two years after Mylan launched its generic version. According to GSK, there was no dispute that Mylan launched its generic version more than two years earlier, so GSK was permitted to sell Paxil CR to Apotex.

Mylan sought $119,700,000 in damages for lost profits and related damages. The amount was calculated by an expert in damages, who opined that Mylan was entitled to the profits it would have made on the units sold by Apotex, because if the Apotex drug had not been on the market, Mylan would have made those sales. GSK’s expert in economics criticized Mylan’s damages claim, primarily on grounds that GSK could have launched its own authorized generic and competed with Mylan’s product.

The jury found that Mylan had proved by a preponderance of the evidence that GlaxoSmithKline had breached its amended contract, and awarded Mylan $106,700,000. Jurors were asked: “What is the amount of money GlaxoSmithKline has proved by a preponderance of the evidence that Mylan’s damages should be reduced by because Mylan failed to make reasonable efforts to lessen or reduce its damages?”; jurors determined the amount was zero. Mylan asked the court to issue a permanent injunction prohibiting GSK from supplying Apotex with the authorized generic of Paxil CR for the life of U.S. Patent No. 7,229,640. In July 2014, the court granted Mylan’s request for a permanent injunction, and noted that "by entering an injunction, the court is not harming GSK, but rather, is forcing it to cease engaging in conduct that it should have ceased already."

Judge:

Joel A. Pisano

Trial Length:

9
 days

Trial Deliberations:

3
 hours

Post Trial:

This report is based on information that was provided by plaintiff’s counsel and SmithKline Beecham Corp. Counsel for Apotex declined to contribute.